Monday, 4 March 2013

Abolish The Income Tax

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The federal income tax is a bad joke and it needs to be
abolished. All over the nation, hard working American families are being
absolutely crushed by oppressive levels of taxation, and our politicians are
constantly coming up with new ways to extract money from all of us every single
year. Meanwhile, many ultra-wealthy Americans and many of the most profitable
corporations in the country pay little to nothing in taxes. In fact, as you
will see below, there are dozens of very prominent corporations that make billions
of dollars in profits and yet don't pay a dime in taxes.

Tax avoidance has become a multi-billion dollar industry in
the United States.
Those that have the resources to "play the game" use shell companies,
offshore tax havens and the thousands of loopholes in our tax code to minimize
their tax burdens as much as possible. Meanwhile, the rest of us get absolutely
hammered. This is fundamentally unfair. The federal income tax system is
irreversibly broken at this point, and it is time to abolish it.

If you think that the federal income tax system can be
"fixed", then you probably have never studied it. Our tax code is
nearly 4 million words long and it is absolutely riddled with thousands of
loopholes that favor big corporations and the ultra-wealthy. We should come up
with a better, fairer way to fund the government. The United States
once prospered greatly without a federal income tax, and it could do so again.

Many people simply do not believe that it is possible for
corporations inside the United
States to make billions of dollars in
profits each year and not pay a dime in income taxes.

Well, according to aa report put out by Public Campaign, that
is exactly what is happening. Posted below are numbers that come directly from
their report. 30 large corporations are listed, and 29 of them had a tax burden
for 2008 through 2010 that was less than zero even though they all made
enormous profits. And all 30 of them spent more on lobbying than they did on
taxes.

The numbers that you are about to see are for 2008, 2009 and
2010 combined. For "taxes paid", please note that for 29 of the
corporations a negative number is given. That means that the net tax liability
for 2008 through 2010 was actually less than zero.

After seeing these numbers, is there anyone out there that
is still willing to claim that our tax system is "fair"?...

General Electric U.S. Profits: $10,460,000,000

Taxes Paid: ‐$4,737,000,000

PG&E Corp. U.S. Profits: $4,855,000,000

Taxes Paid: ‐$1,027,000,000

Verizon Communications U.S. Profits: $32,518,000,000

Taxes Paid: ‐$951,000,000

Wells Fargo U.S. Profits:
$49,370,000,000

Taxes Paid: ‐$681,000,000

American Electric Power U.S. Profits: $5,899,000,000

Taxes Paid: ‐$545,000,000

Pepco Holdings U.S. Profits: $882,000,000

Taxes Paid: ‐$508,000,000

Computer Sciences U.S. Profits: $1,666,000,000

Taxes Paid: ‐$305,000,000

CenterPoint Energy U.S. Profits: $1,931,000,000

Taxes Paid: ‐$284,000,000

NiSource U.S.
Profits: $1,385,000,000

Taxes Paid: ‐$227,000,000

Duke Energy U.S.
Profits: $5,475,000,000

Taxes Paid: ‐$216,000,000

Boeing

U.S.
Profits: $9,735,000,000

Taxes Paid: ‐$178,000,000

NextEra Energy U.S. Profits: $6,403,000,000

Taxes Paid: ‐$139,000,000

Consolidated Edison U.S. Profits: $4,263,000,000

Taxes Paid: ‐$127,000,000

Paccar

U.S.
Profits: $365,000,000

Taxes Paid: ‐$112,000,000

Integrys Energy Group U.S. Profits: $818,000,000

Taxes Paid: ‐$92,000,000

Wisconsin Energy U.S. Profits: $1,725,000,000

Taxes Paid: ‐$85,000,000

DuPont U.S.
Profits: $2,124,000,000

Taxes Paid: ‐$72,000,000

Baxter International U.S. Profits: $926,000,000

Taxes Paid: ‐$66,000,000

Tenet Healthcare U.S. Profits: $415,000,000

Taxes Paid: ‐$48,000,000

Ryder System U.S.
Profits: $627,000,000

Taxes Paid: ‐$46,000,000

El Paso U.S. Profits:
$4,105,000,000

Taxes Paid: ‐$41,000,000

Honeywell International U.S. Profits: $4,903,000,000

Taxes Paid: ‐$34,000,000

CMS Energy U.S.
Profits: $1,292,000,000

Taxes Paid: ‐$29,000,000

Con-­way U.S. Profits: $286,000,000

Taxes Paid: ‐$26,000,000

Navistar International U.S. Profits: $896,000,000

Taxes Paid: ‐$18,000,000

DTE Energy U.S.
Profits: $2,551,000,000

Taxes Paid: ‐$17,000,000

Interpublic Group U.S. Profits: $571,000,000

Taxes Paid: ‐$15,000,000

Mattel

U.S.
Profits: $1,020,000,000

Taxes Paid: ‐$9,000,000

Corning

U.S.
Profits: $1,977,000,000

Taxes Paid: ‐$4,000,000

FedEx

U.S.
Profits: $4,247,000,000

Taxes Paid: $37,000,000 (a rate of less than 1%)

Total

U.S.
Profits: $163,691,000,000

Taxes Paid: ‐$10,602,000,000

Just look at that combined total again.

Those 30 companies had combined profits of more than 163
billion dollars during those three years, and yet the combined net tax
liability of those companies was negative 10.6 billion dollars.

I wish I could make my taxes look like that.

Another company that is making headlines because of their
taxes these days is Facebook.

It turns out that Facebook made more than a billion dollars
in 2012 but did not pay a single dime in federal or state income taxes. The
following is from a report that was just released by Citizens for Tax Justice......
Earlier this month, the Facebook Inc. released its first
“10-K” annual financial report since going public last year. Hidden in the
report’s footnotes is an amazing admission: despite $1.1 billion in U.S. profits in
2012, Facebook did not pay even a dime in federal and state income taxes.

Here are just a few examples of how the corporations and
Wall Street banks these CEOs work for have significantly harmed our economy and
the federal budget:

1. Bank of America
CEO Brian Moynihan

Number of Offshore Tax Havens in 2010? 371.

In 2010, Bank of America operated 371 subsidiaries
incorporated in offshore tax havens. 204 of these subsidiaries are incorporated
in the Cayman Islands, which has a corporate
tax rate of 0%.

Amount of federal income taxes Bank of America would have
owed if offshore tax havens were eliminated? $2.5 billion.

Bank of America has stashed $18.5 billion in offshore tax
havens to avoid paying U.S.
income taxes. Bank of America would owe an estimated $2.5 billion in federal
income taxes if its use of offshore tax avoidance was eliminated.

Bank of America received a $1.9 billion tax refund from the
IRS in 2010, even though it made $4.4 billion in profits.

Taxpayer Bailout from the Federal Reserve and the Treasury
Department? Over $1.3 trillion.

During the financial crisis, Bank of America received a
total of more than $1.3 trillion in virtually zero interest loans from the
Federal Reserve and a $45 billion bailout from the Treasury Department.

Amount of federal income taxes JP Morgan Chase would have
owed if offshore tax havens were eliminated? $4.9 billion

JP Morgan Chase has stashed $21.8 billion in offshore tax
haven countries to avoid payng income taxes. If this practice was outlawed, it
would have paid $4.9 billion in federal income taxes.

Taxpayer Bailout from the Federal Reserve and the Treasury
Department? $416 billion

During the financial crisis, JP Morgan Chase received a
total of more than $391 billion in virtually zero interest loans from the
Federal Reserve and a $25 billion bailout from the Treasury Department, while
Jamie DImon served as a director of the New York Federal Reserve.

3. Goldman Sachs CEO Lloyd Blankfein

Amount of federal income taxes paid in 2008? Zero. $278
million tax refund.

In 2008, Goldman Sachs received a $278 million refund from
the IRS, even though it earned a profit of $2.3 billion that year.

Amount of federal income taxes Goldman Sachs would have owed
if offshore tax havens were eliminated? $3.32 billion.

Goldman Sachs has stashed $20.63 billion in offshore tax
haven countries to avoid paying income taxes. If this practice was outlawed, it
would have paid $3.32 billion in federal income taxes.

Taxpayer Bailout from the Federal Reserve and the Treasury
Department? $824 billion.

During the financial crisis, Goldman Sachs received a total
of $814 billion in virtually zero interest loans from the Federal Reserve and a
$10 billion bailout from the Treasury Department.

-----

Are you starting to get the picture?

The big banks and the big corporations make billions, but
they pay nothing or next to nothing.

The rest of us bust our rear ends to try to get ahead, and
we get gouged by dozens of different taxes.

Over time, the percentage of the overall tax burden
shouldered by corporations has gotten smaller and smaller.

Back in 1950, corporate taxes accounted for about 30 percent
of all federal revenue. In 2012, corporate taxes accounted for less than 7
percent of all federal revenue.

These days, large corporations have become absolute masters
at avoiding taxes. In fact, there are many international tax havens that are
doing a booming business in setting up sham headquarters for U.S.
corporations. For example, the city of Zug, Switzerland
only has a population of 26,000 people but it is the headquarters for 30,000
companies.

But corporations are not the only ones doing this kind of
thing.

The ultra-wealthy have also mastered the art of legally not
paying taxes.

As I mentioned in a previous article, it has been reported
that the global elite have up to 32 TRILLION dollars stashed in offshore banks
around the globe.

With that amount of money, you could pay off the entire U.S. national debt and still have enough money
left over to buy every product and service produced in the United States
during an entire year.

It is time to admit that our tax system is broken. Congress
has had decades to fix it, and yet the abuses just keep getting worse. What we
are doing is not working. We need to abolish the income tax.

If you are still not convinced that the federal income tax
is an abomination and that we need to abolish it, here are some more shocking
facts about our tax system from one of my previous articles about taxes...

1 - The U.S.
tax code is now 3.8 million words long. If you took all of William
Shakespeare's works and collected them together, the entire collection would
only be about 900,000 words long.

2 - According to the National Taxpayers Union, U.S. taxpayers
spendmore than 7.6 billion hours complying with federal tax requirements.
Imagine what our society would look like if all that time was spent on more
economically profitable activities.

3 - 75 years ago, the instructions for Form 1040 were two
pages long. Today, they are 189 pages long.

4 - There have been 4,428 changes to the tax code over the
last decade. It is incredibly costly to change tax software, tax manuals and
tax instruction booklets for all of those changes.

5 - According to the National Taxpayers Union, the IRS
currently has1,999 different publications, forms, and instruction sheets that
you can download from the IRS website.

6 - Our tax system has become so complicated that it is
almost impossible to file your taxes correctly. For example, back in 1998 Money
Magazine had 46 different tax professionals complete a tax return for a
hypothetical household. All 46 of them came up with a different result.

7 - In 2009, PC World had five of the most popular tax
preparation software websites prepare a tax return for a hypothetical
household. All five of them came up with a different result.

8 - The IRS spends $2.45 for every $100 that it collects in
taxes.

9 - According to The Tax Foundation, the average American
has to workuntil April 17th just to pay federal, state, and local taxes. Back
in 1900, "Tax Freedom Day" came on January 22nd.

10 - When the U.S. government first implemented a
personal income tax back in 1913, the vast majority of the population paid a
rate of just 1 percent, and the highest marginal tax rate was just 7 percent.

11 - Residents of New
Jersey pay $1.64 in taxes for every $1.00 of federal
spending that they get back.

12 - The United
States is the only nation on the planet that
tries to tax citizens on what they earn in foreign countries.

13 - According to Forbes, the 400 highest earning Americans
pay an average federal income tax rate of just 18 percent.

14 - Warren Buffett had an effective tax rate of just 17.4
percent for 2010.

15 - The top 20 percent of all income earners in the United States
payapproximately 86 percent of all federal income taxes.

16 - Sadly, as Bill Whittle has shown, you could take every
single penny that every American earns above $250,000 and it would only fund
about 38 percent of the federal budget.

Please share this article with as many people as you can. We
have now entered a time of the year when tens of millions of Americans will be
filling out their tax returns, and the pain of going through that process will
make people even more receptive than normal to the truth about how broken our
system is.

So what do you think?

Do you think that it is fair for the ultra-wealthy and hugely
profitable corporations to get away with paying zero taxes while you get
hammered?

Do you believe that it is time to abolish the income tax?

Please feel free to post a comment with your thoughts
below...

This article first appeared here at the Economic Collapse
Blog.Michael Snyder is a writer,
speaker and activist who writes and edits his own blogs The American Dream and
Economic Collapse Blog. Follow him on Twitter here.

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